(Note: This is the same problem as Problem 8-4, but assuming use of the complete or the partial equity method.) Trial balances for Porter Company and its subsidiary, Spitz Company, as of December 31, 2011, follow:

Porter Company made the following open-market purchase and sale of Spitz Company common stock: January 1, 2007, purchased 45,000 shares for $135,000; May 1, 2011, sold 4,500 shares for $28,000.
The book value of Spitz Company’s net assets on January 1, 2007 was $140,000; the excess of cost over net assets acquired relates to land. Subsequent changes in the book value of Spitz Company’s net assets are entirely attributable to earnings retained in the business. Spitz Company earns its income evenly throughout the year.

Required:
Prepare a consolidated financial statements workpaper as of December 31, 2011. Begin the income statement section of the workpaper with “Net Income before Equity in Subsidiary Income and Gain on Sale of Investment,” which is $63,200 for Porter Company and $60,000 for SpitzCompany.

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Debits Porter itz $90,000 62,000 106,000 231,660 320,000 69,000 50,000 40,000 38,000 64,000 Gash Accounts Receivable (net) Inventory Investment in Spitz Company Plant Assets Land Dividends Declared, 10/1 149,000 46.000 30.000 8,660$367.000 Total 928 Credits Liabilities Common Stock, $2 par value Other Contributed Gapital 1/1 Retained Earnings Income Summary $102,000 250,000 161,160 301,900 113,600 928,660 61,000 100,000 20,000 126,000 60,000 $367.000 Total